Scope 1, 2 and 3 of Carbon Emissions

What do I need to know?

Scope 1

‍Scope 1 covers direct emissions. These emissions come from activities and resources directly related to and controlled by the company.

This includes emissions from vehicles, AC systems, and manufacturing processes of products. These emissions are divided into four categories: Stationary Combustion, Mobile Combustion, Fugitive Emissions, and Process Emissions.

‍Scope 2

‍Scope 2 emissions are indirect emissions. This refers to all emissions emitted to the atmosphere from energy usage in buildings.

It covers purchased energy from utility providers of heating, electricity, water, and cooling. These emissions are indirect as the energy comes from utility providers and, thus, are not categorized as controlled by the company itself.

‍Scope 3

‍Scope 3 emissions are also indirect emissions. These emissions cover all the emissions that aren't a part of the scope 2. This includes all upstream and downstream emissions from within the value chain. The GHG Protocol divides these emissions into 15 categories.

‍The categories cover waste, capital goods, the production of purchased goods and services, Fuel- and Energy-related activities not included in scope 1 and 2, and investments. The Fuel- and Energy activities are especially relevant for property owners, as this relates to emissions spanning from transportation, extraction, and production of, e.g., electricity and heating for buildings.

The category of Investments is divided into four subcategories: Equity Investments (purchasing of shares), Debt Investments (corporate or government bonds), Project Finance (infrastructure or industrial projects), and Managed Investment and Client Services (Asset Management).